What Is the Tax Implication If a Crypto Option Is Classified as a “Collectible”?
If a crypto option or the underlying crypto is classified as a "collectible," any long-term capital gain is taxed at a maximum rate of 28%, which is higher than the maximum 20% rate for other long-term capital gains. This is a significant negative implication.
However, the IRS generally treats cryptocurrency as property, not a collectible, unless it represents a unique digital asset like an NFT.